KUALA LUMPUR: Rubber glove solutions provider Flexidynamic Holdings Bhd has signed a binding letter of intent with Gammatech Sdn Bhd to acquire 51 per cent of the latter's enlarged issued share capital.
The acquisition will be made at a total subscription price of RM1.04 million, with each new share priced at RM1.00.
Upon the completion of the subscription, Gammatech will become a 51 per cent-owned subsidiary of Flexidynamic.
Gammatech is planning to offer sterilisation services utilising gamma radiation.
Gamma radiation sterilisation is a highly effective method for eliminating microorganisms to ensure sterility, commonly used in the medical and pharmaceutical industries for sterilising devices, instruments and products.
"This new offering may serve not just the existing customers in the glove industry, but can also include industries such as pharmaceuticals, food processing, and packaging.
"By offering gamma radiation sterilisation services, Flexidynamic aims to meet the growing demand for sterile products, leveraging its existing customer base and expanding into these broader markets," it said.
Flexidynamic managing director Tan Kong Leong said the investment in Gammatech represents a significant milestone for the company as it enters the gamma radiation sterilisation sector.
"We see substantial potential in this field and are confident that this move will complement our existing operations while opening new avenues for growth in the recovering medical glove industry.
"Our commitment to innovation and expansion continues to drive our business forward, ensuring long-term value for our shareholders," he said.
Gammatech representative said Flexidynamic's expertise and vision will contribute to the launch and growth of the company.
Flexidynamic's share price closed at 21 sen, up five per cent, for a market capitalisation of RM62.9 million.